893.51/4923: Telegram
The Secretary of State to the Minister in China (MacMurray)
114. American Group inform Department that they have received telegram from their representative in Peking as follows:
“Foreign Office recently requested Diplomatic Body release to them customs funds to meet various pressing needs as the result of civil war. The Diplomatic Body replied as follows under date May 12th:
‘The interested heads of Legation have the honor to inform the Ministry that so long as they are assured a sufficient sum has been set aside from the revenue [Page 949] collected by the Chinese Maritime Customs Administration and lodged in the custodian banks to safeguard the service of the foreign loan concluded before 1900, and of the indemnity of 1901, and the Reorganization Loan of 1913, secured on the customs revenue, they are not concerned with the use to which the surplus of these customs revenues may be put after the aforesaid loan and indemnity service have been fully met and, further, that, apart from the expectation which they naturally entertain that the Chinese Government will in equity meet their other outstanding foreign obligations no less than their domestic obligations out of any available assets, they do not desire to interfere with any arrangements arrived at between the Chinese Government and the Inspector General of Customs with regard to the disposal of this surplus revenue.’”
American Group refer to recent protests of Legations to Chinese Government, including your note No. 162 of February 6 to Chinese Minister of Foreign Affairs, regarding use of customs funds in meeting internal obligations at a time when previously outstanding foreign obligations are in default. They consider attitude of Ministers as evinced in despatch above quoted to be a radical reversal of position taken in connection with protests above referred to. They recall that prior to 1921 no customs funds were available to Chinese Government except with consent of Diplomatic Body pursuant to 1912 agreement. They refer in that connection to Chinese Secretary’s memorandum of December 2, 1921, copy of which was forwarded by Bennett.24 They suggest that Ministers should have taken opportunity afforded by request of Foreign Office to protect interests of nationals holding foreign loans which have been made subject of protests above referred to.
Please telegraph brief comment in regard to above for communication to Group.
- Memorandum not printed.↩